By Cecilia Lou and Steven Yao King & Wood’s Intellectual Property Group

The Patent Law of the People’s Republic of China(1)("Patent Law") and Regulations for the Implementation of the Patent Law of the People’s Republic of China(2) ("Implementing Regulations") has drawn our attention to rewards and remuneration for inventors. The Patent Law stipulates that employers must pay reasonable rewards and remuneration to inventors of a service invention and the Implementing Regulations explicitly address the amount payable. For purposes of encouraging technological innovation and industrialization, the change is sure to play a positive role in motivating employee initiatives and promoting social productivity. However, it will also bring certain challenges to many employers in terms of compliance with reward and remuneration issues in China, especially when the Blue LED case in Japan resulted in a 70 million RMB settlement.

The key issue of concern to employers is: Whether the huge commercial benefits acquired by the employer based on a service invention made by its employee do not correspond to the remuneration received from the employer due to the creation of the service invention agreed in the remuneration clause in China, whether the employee shall be entitled to request the court to modify or even revoke the remuneration clause and request some additional remuneration?Continue Reading Dodging Service Invention Disputes